Yes, it's a home for solitary bees. There are a bunch of species of solitary bees, who don't live in hives or swarm with others. They're still an important part of our ecosystem and play a big role in pollination but they don't get quite as much attention as the honeybees.

They collect pollen to survive and to feed their young. Typically they find a hole of the right size, like the ones in these sticks, and make a bunch of compartments inside (out of mud or chewed plant fibers) where they lay their eggs. They give each egg some pollen they've gathered and seal them in for the winter. In the spring the eggs hatch and new bees emerge, eat the pollen, dig their way out, and start the cycle again.

It's good to identify the kinds of bees you want, since they need different size holes, and to put the house somewhere the morning sun will hit it, near some flowers or flowering shrubs.

It's a nice way to help provide habitats. Solitary bees are typically pretty skittish and won't/can't form angry swarms because of the whole solitary thing. Carpenter bees will sometimes fly close to humans, but mostly because they're just big curious bumbling buddies and they're nearsighted. Once they figure out what you are they fly away. I've never had any trouble with the residents of our bee house.